February 21, 2005
Om Malik and PVRBlog, along with Phillip Swann, have an interesting debate on how to save Tivo. Om Malik's approach is to give away 2M units to build a userbase and create a premium brand. PVRBlog makes the cogent point that Tivo doesn't have the cash flow required.
I think they both make valid points, and undoubtedly, Tivo has a premium user interface. However, I don't see Tivo being a premium brand over the next year without better support for HDTV, which by all indications, is where the market is moving.
For all the talk of Tivo being a technology company, they are way behind the curve when it comes to HDTV, and as I've questioned in the past, who will want a standard Tivo controlling their television experience if they own a HDTV-ready television? To be fair, they do have a unit that works for their DirecTV subscribers, but as others have said, that relationship is on shaky ground at best.
Compressing analog HDTV streams in real-time is still cost prohibitive, but there are still two technologies that could be used in the interim. The first is building a unit with an extra Over-The-Air HDTV capture card, which isn't ideal, but gets a foot in the HDTV door (the fact that Tivo doesn't have a standalone DVR with two capture cards has always been a real head scratcher for me, but that's another topic). The longer term technology is Cable Card, which eliminates the set-top box altogether.
Without a good HDTV strategy, it's days as an independent entity are limited. Without some success partnering or building next generation products quickly, Tivo has no HDTV strategy.
Posted on February 21, 2005
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